Memorandum of Understanding between the National Energy Board and the Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation

I. Purpose

The National Energy Board (NEB) of Canada and the Pipeline and Hazardous Materials
Safety Administration (PHMSA) of the U.S. Department of Transportation (DOT) (together,
"the Parties") enter into this Memorandum of Understanding (MOU) to enhance
cooperation and coordination between the Parties for the purpose of improving pipeline
safety in both Canada and the United States.

II. Background

NEB regulates aspects of the energy industry in Canada including the construction
and operation of inter-provincial and international pipelines; pipeline traffic, tolls
and tariffs; the construction and operation of international and designated inter-provincial
power lines; the export and import of natural gas; the export of oil and electricity;
and Frontier oil and gas activities.

PHMSA regulates safety, reliability, and environmental soundness in the design,
construction, testing, operation, maintenance, and spill response planning for natural
gas and hazardous liquid pipeline facilities used in or affecting U.S. interstate
and foreign commerce.

The pipeline infrastructure in Canada and the United States is interconnected and
the continued safe operation of this infrastructure is dependent on the adequacy and
effectiveness of design, construction, operation, maintenance, and other aspects of
pipeline transportation activities in both nations. The Parties recognize that the
conduct of their responsibilities has and will in the future require them to examine,
regulate, or otherwise oversee interconnecting pipeline facilities or activities.
The Parties further recognize that appropriate cooperation in the development and
implementation of regulatory programs will provide greater regulatory certainty to
pipeline companies operating pipelines which cross the boundary between Canada and
the United States.

III. Terms of Agreement

The Parties contemplate that cooperation may take the form of staff exchanges,
emergency management planning and exercises, joint training initiatives, consultative
regulatory development, and sharing of compliance data and reports. To the extent
any investigation reports, findings, and company intelligence are shared in furtherance
of the purposes of this MOU, each party shall protect any non-public records or portions
thereof provided by the other party from unauthorized disclosure in accordance with
applicable law and shall obtain the consent of the providing party before disclosing
any confidential information. PHMSA further agrees that it will specify when information
it provides is being submitted "in confidence" so that that the NEB can
refuse disclosure of that material in accordance with Canada's Access to Information Act.

The Parties contemplate that cooperation may take place on research and development
activities. These activities can take the form of coordination meetings to identify
mutual areas of research and the possible co-funding of identified research projects.

When either party undertakes a compliance audit on a pipeline that crosses the
border between Canada and the United States, the party undertaking the audit shall
notify either the NEB Secretary or the PHMSA's Assistant Administrator/Chief Safety
Officer as appropriate. Where appropriate, such notification may include an invitation
to observe the audit.

When either party commences an enforcement action on a pipeline that crosses
the border between Canada and the United States, the party commencing the action shall
notify either the NEB Secretary or the PHMSA's Assistant Administrator/Chief Safety
Officer as appropriate.

If an Alaskan Natural Gas Pipeline is authorized by law to be designed, constructed
and operated, the Parties will coordinate and collaborate in the manner described
herein as appropriate.

IV. Other Provisions

Nothing in this MOU or any annex is intended to impose any funding obligations
on either of the Parties. Nothing in this MOU or any annex is intended to diminish
or otherwise affect the authority of either party to carry out its statutory, regulatory
or other official functions or to commit either party to providing a particular service
they would not otherwise provide in the scope of each party's individual mission and
functions.

Nothing in this MOU or any annex shall be construed to conflict with current
law, regulation, or directive of the NEB or the DOT. If a term of this MOU or any
annex is determined to be inconsistent with such authority, that term shall be invalid
to the extent of the inconsistency. The remainder of that term and all other terms
shall remain in effect.

Nothing in this MOU or any annex is intended to create any right or benefit,
substantive or procedural, enforceable at law by any person or organization against
either party, its agencies or officers, state agencies or officers carrying out programs
authorized under federal law, or any other person.

This MOU and any annexes hereto may be amended or modified at any time by written
agreement of the NEB Secretary and the PHMSA Administrator.

Should disagreement arise on the interpretation of any provision of this MOU
or any amendments and/or modifications thereto that cannot be resolved at the operating
level, the area(s) of disagreement shall be stated in writing by each party and presented
to the other party for consideration. If agreement on interpretation is not reached
within thirty days, the Parties shall forward the written presentation of the disagreement
to respective higher officials for appropriate resolution.

V. Principal Contacts

The Parties designate the principal contacts identified in Attachment A. Each party's
contact may be changed at its discretion upon notice to the other party.

VI. Effective Period/Termination

This MOU will be effective as of the date of final signature by both of the Parties
and will remain in effect until terminated by either party. Either party may terminate
this MOU and any annexes hereto upon written notice to the other party.